Before you choose to work with an adviser or broker, you’ll want to research his or her professional standing. Investment advisers generally must register with either the
SEC (if they manage $25 million or more in client assets) or the state securities agency where they have their principal place of business (if they manage less than $25 million in client assets). Before hiring an investment adviser, you can determine whether he or she is properly registered by looking up the registration form, called the "Form ADV." Part 1 of this document has the information about the adviser's business and the history of any problems with regulators or clients. Part 2 describes an adviser's services, fees, and strategies.
A word to the wise
You can obtain copies of an adviser's Form ADV from the adviser, your state securities regulator, or the SEC, depending on the size of the adviser. For contact information on your state securities regulator, go to the Check the Background of Your Investment Professional page in the Investor Information section at
www.finra.org.
For an adviser registered with the SEC, you can view the most recent Form ADV at the Investment Adviser Public Disclosure (IAPD) Web site at
http://adviserinfo.sec.gov/
